KARACHI: All Pakistan Betel Nuts Importers Association has sounded the alarm over what it calls a systemic failure by customs authorities, leading to massive revenue losses and strangling the legal import of betel nuts, a widely consumed product in the country.
Through their lawyer, Asif Abro Advocate, the association has filed a detailed legal representation with the Chairman of the Federal Board of Revenue (FBR). The core of their complaint targets the inaction of the Chief Collector of Customs (Appraisement) South in Karachi, who they accuse of failing to protect his own department’s legal turf from encroachment by another agency.
The controversy stems from a letter (No. DPP/PSW/PQ/2025) issued on December 16, 2025, by the Department of Plant Protection (DPP) in Karachi. In this letter, the DPP stated that the “In-to-Bond” filing of Goods Declarations (GDs) for betel nut imports “shall be discouraged.”
For importers, this is a critical blow. Betel nuts require lab tests for aflatoxin (a harmful fungus) before they can be cleared. If contaminated, the entire shipment must be re-exported or destroyed.
The “In-to-Bond” system is a trade facilitation measure. It allows importers to file a GD and move their goods into a bonded warehouse by paying only 1% of the estimated duties and taxes. The remaining 99% is paid only after the goods pass the lab test. This protects importers from losing their entire capital upfront if a shipment fails.
By discouraging this system, the DPP is effectively forcing importers to pay 100% duties before the test, a risky financial move that the association says is killing the legal trade.
Advocate Asif Abro’s representation is scathing in its legal critique. It argues that the DPP, a department under the Ministry of National Food Security, has stepped far beyond its legal mandate.
“The Goods Declaration is a concept created and governed exclusively by the Customs Act, 1969. No other department has the statutory authority to dictate how a GD should be filed,” the document states, calling it a “classic case of jurisdictional trespass.”
The representation further claims that the DPP’s actions violate multiple articles of the Constitution (including Article 18 on freedom of trade) and are inconsistent with Pakistan’s international commitments under WTO trade facilitation agreements, which encourage flexible security measures like bonded warehousing.
The association paints a grim picture of the market’s current state. They estimate that 90% of Pakistan’s betel nut demand is met through smuggling, with only 10% coming through legal ports. Smuggled goods pay no duties and undergo no health checks.
“No one cares about the aflatoxin or duties on smuggled betel nuts, which are openly sold in every market from Karachi to Gilgit,” the representation notes.
They allege that the DPP’s move, by crippling legal importers, plays directly into the hands of a powerful “organized racket” of smugglers, potentially aided by corrupt elements (“black sheep”) within the government. The result is a double loss: legitimate businesses suffer, and the national exchequer loses an estimated over 3 billion rupees per month (36 billion annually) in potential revenue.
The representation urges the FBR Chairman to:
1. Direct the Chief Collector of Customs to immediately take up the matter with the DPP for the withdrawal of the “illegal” letter.
2. Escalate the issue of systematic hindrances created by DPP to the Federal Secretary for National Food Security or the Prime Minister.
3. Implement necessary changes in the Pakistan Single Window (PSW) system to facilitate the In-to-Bond GD regime.
The association has copied the representation to high-level officials, including the Prime Minister’s Secretary and the Federal Secretary for National Food Security, seeking their intervention to protect legal trade and state revenue.
